The parties were involved in a dispute about a commercial lease renewal in which the Plaintiff corporation was economically strained and had no income. The Defendant brought a Security for Costs Application. Master Schlosser stated that the amount of Security for Costs must first be determined pursuant to Rules 4.22(a) and (b), as well as Section 242 of the Business Corporations Act, RSA 2000, c B-9.

Master Schlosser observed that Rule 10.31 is a starting point for determining Costs, and while Schedule C Costs are an option they are neither presumed nor binding. The Action fell under Column 3 of Schedule C. Master Schlosser commented that Security for Costs Applications are usually a balancing act between protection of the Applicant for their Costs, and the “risk of creating an impediment that the Respondent cannot overcome”. Security for Costs should not become “de facto Summary Judgment for economic reasons,” and incremental Security for Costs Orders can solve this problem. Master Schlosser considered the parties' circumstances and relevant prior authorities, and determined that a Security for Costs assessment should be prospective in nature, and in this case should be determined in increments for three future stages: disclosure of information, expert reports and Trial. The Security for Costs Application was granted.